Petro giant NSH chairman's son fined for manipulating shares

Four individuals, including the son of Nam Song Hau Petroleum Trading Investment JSC's (NSH Petro) chairman, have been fined a combined VND6 billion ($235,710) for manipulating NHS Petro stock prices.

The State Securities Commission (SSC) on Monday issued the decision to sanction administrative violations against Mai Huu Phuc, Vo Nhu Thao, Do Thuy Tien, and Tran Minh Hoang, who have all been fined VND1.5 billion ($58,927) each.

Mai Huu Phuc is the son of Mai Van Huy, chairman of NSH Petro.

From February 1, 2021 to May 27, 2022, the above four individuals used 26 accounts in the names of 15 investors to continuously buy and sell shares in NSH Petro, listed in the HCMC Stock Exchange (HoSE) as PSH, to create artificial supply and demand and manipulate the stock's price.

The 26 accounts participated in 135/140 trading sessions from February 1, 2021 to August 25, 2021, and carried out 12,860 buy orders with a total volume of 91,506,800 shares, accounting for 64.5% of the transaction volume, with 66,953,000 shares matched, accounting for 67.2%.

They also used 26 accounts to place 7,587 sell orders with a total volume of 109,736,100 shares, accounting for 60.4% of the market, with matched selling volume of 74,760,900 shares, accounting for 75.1% of the transactions.

In addition to administrative fines, the four individuals were also subject to preventive measures to stop them from reoffending.

Mai Huu Phuc, Vo Nhu Thao, and Do Thuy Tien were banned from trading securities for two years, and prohibited from holding positions at securities companies, securities investment fund management companies, branches of securities companies, or foreign fund management companies in Vietnam for two years, starting May 27.

Tran Minh Hoang was banned from trading securities for three years and prohibited from holding positions at securities companies, securities investment funds, or foreign funds in Vietnam for three years.

PSH shares witnessed unusual fluctuations during the stated period, soaring twice and bottoming out once. From the beginning of the year to mid-2021, the ticker increased from VND17,200 ($0.68) to over VND32,000 ($1.26), then plummeted within three months to the former price range before rebounding to VND29,200 ($1.15) in March 2022.

New movements at NSH Petro

NSH Petro's board of directors decided to dismiss Phuc from his position of deputy general director on May 24 based on personal grounds.

Mai Van Huy once held the controlling rights to the western petroleum giant, with an ownership ratio of up to 66.65% at the beginning of 2023. However, in 2023 and the first half of 2024, the chairman of the company sold off millions of PSH shares. In the last three trading sessions from April 15 to April 17, Huy offloaded 18.8 million shares, reducing his ownership volume to 56.5 million units, equivalent to a 44.8% stake.

NSH Petro has encountered cash flow difficulties, continuously extending bond payment periods, high bond maturity pressure, and tax enforcement of trillions of VND (VND1 trillion = $39.28 million). Acuity Funding has agreed to invest $290 million in NHS Petro, which is expected to be disbursed in Q2/2024, for the company to pay tax debts, bank debts, provide working capital, and invest in projects.

According to the agreement, Acuity Funding will continue to provide capital to NSH Petro to implement five new factory construction projects in Tien Giang province, renovate the Nam Viet Cai Rang factory in Can Tho province, increase working capital, and support the completion of mixed-use projects in Dong Phu commune, Chau Thanh district, Hau Giang province, and Phong Dien district in Can Tho city, with total capital of about $430 million.

Along with the loan, NSH Petro has appointed Ranjit Prithviraj Thambyrajah, chairman and CEO of Berhero Pty Ltd. and Acuity Funding, as general director, and Nguyen Viet Anh, director of Acuity Funding Vietnam, as head of financial investment, as of April 26.

At the upcoming AGM, NSH Petro will dismiss one member and elect one additional member of the board of directors and supervisory board for the term 2022-2027. The company's board of directors currently has four people, including Mai Van Huy as chairman, Mai Van Thanh - Huy's brother as vice chairman, Ha Ngoc Thuong, and Vo Bich Tram.

At the same time, the board of directors has submitted a plan to double its capital by offering 130 million individual shares at a price of VND10,000 ($0.39). Shares offered via private placement are restricted from transfer for one year from the date of completion of the offering. NSH Petro wants to mobilize VND1,300 billion ($51 million) to buy raw materials and other inputs to serve production and business in 2024 and 2025.

For 2024, the company has set ambitious targets with revenue of VND14,566 billion ($572 million), 2.4-fold year-on-year, and an after-tax profit of VND328 billion ($12.9 million), 6.9 times that in 2023.

In Q1, the company reported its revenue decreased 88% year-on-year to VND476 billion ($18.7 million) and a net loss of VND24 billion ($942,690).